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  • Writer's pictureJoe DeLisi

Don't Date Your Investments

I have 6 kids, 3 of which are teenagers and 5 of which are daughters. So dating is a hot topic in the DeLisi household. One of the pieces of advice I give them that they totally ignore is that the purpose of dating is to marry someone forever. That’s really the reason one should date. But that is not how “this generation” views it. They view it as a relationship status that they will dump at the first sign of a problem.


Unfortunately, that’s how many people treat their investment portfolios. They jump in, but at the first sign that the market or a specific market (like small cap stocks, or emerging market stocks) don’t produce IMMEDIATE results, they want to bail. I know where this behavior comes from. It comes from the financial media and places like Twitter where people are shown static and linear rates of return. “The market gets 10%” is one of my favorites. Does it? Maybe but…

· Which market?

· Over what period?

· Net of taxes?

· Net of fees?

· Linearly?

· Single deposit or dollar cost averaging?



For the “which market”, let’s go with the S&P 500. Does the S&P 500 get 10%? Yeah it does. Sometimes. For example, from Jan 1, 1973 through Dec 31, 2022, that market produced a rate of return of 10.3% (rounded)[1]. But that is on a lump sum of money only with no additional deposits. When you calculate the return over the exact same time but instead use monthly contributions instead of a lump sum, that return changes to over 11%. Same market. Same time. Different return.


But does this market always just deliver 10+%? Is it LINEAR? HECK NO.


Let’s look at more recent history: from January 1, 1994 through March of 2009, the return wasn’t quite 10 or 11%...It was…NEGATIVE (if you were adding money to the account every month instead of just a lump sum. A lump sum would have a 2.6% return). Read that again!


If you dollar cost averaged into the S&P 500 index every month for roughly 15 years, you got less than a 0% rate of return. 15 YEARS! Imagine if you cashed out? What would that have done to you? I mean, you gave it a heck of a try…you hung on for 15 years and then you divorced your investments. Why wouldn’t you? 15 years! That’s enough. No one can deal with a negative return over 15 years when you were PROMISED a rate of return of x%, right?


Well if you “divorced” your investments after 15 years, you would have given up about a 9% total rate of return over almost 30 years. From March of 1994 through March of 2023, the S&P 500 returned 8.98%.


Where am I going with all this?


In investing you MUST marry yourself to the plan. The plan should be simple…you buy equities that are allocated across small and large, value and growth and domestic and international. You rebalance those different accounts systematically. You own high quality, short term fixed income and/or guaranteed annuities and life insurance policies with cash value to offset negative volatility in your equities…and you STICK WITH IT[2]. You never get divorced from your strategy.


Having a portfolio like the above will give you fits at times. There will be stretches, sometimes LOOOONG stretches of poor performance in an asset class (15 years!). But to be rewarded with return you must stick with it.


Investing isn’t dating. It’s marriage. For better or worse, in sickness and in health, we contribute to our portfolios and we allow the free markets to produce returns for us. The job of the markets is to allow us the chance for return. Our jobs are to give it the time and space to do so.


Questions, comments? Let me know!



Registered Representative and Financial Advisor of Park Avenue Securities LLC (PAS). OSJ: 5280 CARROLL CANYON ROAD, SUITE 300, SAN DIEGO CA, 92121, 619-6846400. Securities products and advisory services offered through PAS, member FINRA, SIPC. Financial Representative of The Guardian Life Insurance Company of America® (Guardian), New York, NY. PAS is a wholly owned subsidiary of Guardian. WESTPAC WEALTH PARTNERS LLC is not an affiliate or subsidiary of PAS or Guardian. Insurance products offered through WestPac Wealth Partners and Insurance Services, LLC, a DBA of WestPac Wealth Partners, LLC. CA Insurance License # 0D34103 | Guardian, its subsidiaries, agents, and employees do not provide tax, legal, or accounting advice. Consult your tax, legal, or accounting professional regarding your individual situation. | 2023-156073 Exp. 05/25


Past performance is not a guarantee of future results. Indices are unmanaged and one cannot invest directly in an

index. Diversification does not guarantee profit or protect against market loss.


All investments contain risk and may lose value. Investing in the bond market is subject to certain risks including market, interest rate, issuer, credit and inflation risk. Equities may decline in value due to both real and perceived general market, economic and industry conditions. Investing in securities of smaller companies tends to be more volatile and less liquid than securities of larger companies. Investing in foreign securities may involve heightened risk including currency fluctuations, less liquid trading markets, greater price volatility, political and economic instability, less publicly available information and changes in tax or currency laws. Such risks are enhanced in emerging markets.

[1] https://www.spglobal.com/spdji/en/indices/equity/sp-500/#overview [2] Annuity and life insurance guarantees are backed by the strength and claims-paying ability of the issuing insurance company. 3) Some whole life polices do not have cash values in the first two years of the policy and don’t pay a dividend until the policy’s third year. Talk to your financial representative and refer to your individual whole life policy illustration for more information.


[1] Annuity and life insurance guarantees are backed by the strength and claims-paying ability of the issuing insurance company.



3) Some whole life polices do not have cash values in the first two years of the policy and don’t pay a dividend until the policy’s third year. Talk to your financial representative and refer to your individual whole life policy illustration for more information.

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